William Mitchell argues that the German debt brake is detrimental to the economy and undermines democratic principles in his analysis of Modern Monetary Theory.

William Mitchell argues that the German debt brake is detrimental to the economy and undermines democratic principles in his analysis of Modern Monetary Theory.

## FAQ

### What is the German debt brake?
The German debt brake is a rule introduced in 2009 that restricts the federal government fiscal deficit to not exceed 0.35 percent of GDP and prohibits German states from taking on debt after 2020.

### How has the German debt brake impacted public infrastructure?
The application of the German debt brake has resulted in government investment spending being starved, leading to negative impacts on public infrastructure in Germany.

### What are the concerns raised about the German debt brake?
Critics argue that the German debt brake undermines the government’s capacity to address decaying public infrastructure, meet climate challenges, and generate political space for right-wing extremists to gain ground. It is also seen as a threat to democracy in Germany.

## Conclusion
The reimplementation of the German debt brake has raised concerns about its impact on the economy, public infrastructure, and democracy in Germany. Critics argue that the rigid fiscal rules imposed by the debt brake hinder the government’s ability to respond effectively to challenges and promote well-being. As Germany faces economic challenges and political upheaval, the debate over the debt brake continues to be a contentious issue.

Leave a Reply

Your email address will not be published. Required fields are marked *